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on History and Philosophy of Economics |
| By: | Krauss, Alexander |
| Abstract: | What drives groundbreaking research in economics? Nobel-prize-winning work has had an important impact on public policies, but we still do not understand well what drives such breakthroughs. We collect data on all nobel-prize discoveries in economics to address this question. We find that major advances in the field of economics are brought about by methodological innovation: by developing new and improved research methods. We find that developing for example econometrics in 1933, randomised controlled trials in 1948 and new game theory methods in 1950 were essential to opening the new fields of corporate finance, experimental economics and information economics, respectively. We identify the development of new methods as the main mechanism driving new discoveries and research fields. Fostering this general mechanism (generating novel methods) holds the potential to greatly increase the rate at which we make new breakthroughs and fields. We also show that many of the main methods of economics – such as randomised controlled trials, natural experiments, regression discontinuity, instrumental variables and other statistical methods – had been developed and used in other fields like public health, before economists adopted them. This shift towards more powerful empirical methods in the field has important implications on developing new and better methods and adopting them from related fields to make new advances more rapidly. |
| Keywords: | economic breakthroughs; economic discoveries; economic methods; economics of science; Nobel prize; scientific discovery; scientific innovation |
| JEL: | J1 |
| Date: | 2024–05–01 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:123039&r= |
| By: | Gräbner-Radkowitsch, Claudius; Kapeller, Jakob |
| Abstract: | At its core, the discussion on the micro-macro link in heterodox economics is concerned with the correct treatment of aggregates and aggregation in social theory. In this chapter we survey heterodox approaches to the micro-macro link with a focus on shared understandings and convictions that apply across different schools of thought. In addition, we illuminate typical fallacies related to the treatment of aggregation and aggregates as well as the philosophical underpinnings of heterodox ontology to better understand conceptual differences between heterodox economics and competing approaches. Given that economics faces myriad problems of aggregation - as in the case of market interaction, macroeconomic aggregates, or interpersonal coordination and contracting - the quest to provide suitable conceptual tools and philosophical foundations to adequately address aggregates and aggregation should be of special interest to economists of different persuasions. |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:ifsowp:296479&r= |
| By: | Oliver, Adam |
| Abstract: | In several articles over the past decade, Shaun Hargreaves Heap has proposed a liberal, constitutional approach to behavioural public policy that conflicts with the paternalistic consequentialist approaches that have dominated the field to date. In recent years, I too have developed a behavioural public policy framework that sits within the classical liberal tradition. Recently, in commenting on my book, A Political Economy of Behavioural Public Policy, Hargreaves Heap identified similarities between my approach and that of the great 20th Century journalist and scholar, Walter Lippmann. In this article, I outline Lippmann’s arguments in his classic book, The Good Society, in some detail, and reach the conclusion that Hargreaves Heap was right in suggesting that I am a Lippmannite. Finally, given that Hargreaves Heap and I share a belief in liberalism, I summarise why I think he is a Lippmannite too. |
| JEL: | J1 |
| Date: | 2024–05–08 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:122374&r= |
| By: | Li Mingqian |
| Abstract: | The connotation of transaction costs has never been definitively determined, and the independence of the concept has never been rigorously demonstrated. This paper delves into the thought systems of several prominent economists in the development of transaction cost economics, starting from first-hand materials. By combining multiple works of the authors, it reconstructs the true meanings and identifies endogeneity issues and logical inconsistencies. The conclusion of this paper is bold. Previous research has been largely filled with misinterpretations and misunderstandings, as people have focused solely on the wording of transaction cost definitions, neglecting the nature of transaction costs. The intention of transaction cost theory has been unwittingly assimilated into the objects it intends to criticize. After delineating the framework of "transaction costs-property rights-competition", this paper reconstructs the concept of transaction costs and the history of transaction cost concepts, providing a direct response to this theoretical puzzle that has plagued the academic community for nearly a century. |
| Date: | 2024–05 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2405.09087&r= |
| By: | Snir, Avichai; Levy, Dudi; Wang, Dian; Chen, Haipeng (Allan); Levy, Daniel |
| Abstract: | Many experimental studies report that economics students tend to act more selfishly than students of other disciplines, a finding that received widespread public and professional attention. Two main explanations that the existing literature offers for the differences found in the behavior between economists and non-economists are: (i) the selection effect, and (ii) the indoctrination effect. We offer an alternative, novel explanation: we argue that these differences can be explained by differences in the interpretation of the context. We test this hypothesis by conducting two social dilemma experiments in the US and Israel with participants from both economics and non-economics majors. In the experiments, participants face a tradeoff between profit maximization (market norm) and workers’ welfare (social norm). We use priming to manipulate the cues that the participants receive before they make their decision. We find that when participants receive cues signaling that the decision has an economic context, both economics and non-economics students tend to maximize profits. When the participants receive cues emphasizing social norms, on the other hand, both economics and non-economics students are less likely to maximize profits. We conclude that some of the differences found between the decisions of economics and non-economics students can be explained by contextual cues. |
| Keywords: | Selection; Indoctrination; Self-Interest; Market Norms; Social Norms; Economic Man; Rational Choice; Fairness; Experimental Economics; Laboratory Experiments; Priming; Economists vs. Non-Economists; Behavioral Economics |
| JEL: | A11 A12 A13 A20 B40 C90 C91 D01 D63 D91 P10 |
| Date: | 2024–04–21 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:120871&r= |
| By: | Petri, Fabio (University of Siena) |
| Abstract: | What of the first chapter of Marx’s Capital remains valid if one adopts Sraffian price theory? More than one might think, given that the thesis that labour is the substance of value must be abandoned; the two main new clarifications the chapter intended to contribute, namely the analysis of fetishism (with that of the forms of value which is its necessary premise), and the concrete labour/abstract labour distinction, remain valid. The reason why the first pages of the chapter are unclear and aprioristic is traced to Marx’s decision to postpone to Volume III the ‘compensation-of-deviations’ argument with its premise that commodities do not exchange in proportion to embodied labour, a decision which obliges him to assume in this chapter a strict labour theory of value without explanation of why it holds. Böhm-Bawerk’s interpretation of the ‘only-one-property-remains’ argument is criticised. Marx’s persuasion that when things are quantitatively comparable relative to a common quality there must be a common ‘substance’ in them determining that comparability is discussed. The need to ‘reduce’ labour to homogeneity clarifies the meaning of abstract labour but contradicts Marx’s insistence on the notions of ‘human labour in general’ and ‘equality and equivalence of all kinds of labour’. |
| Keywords: | Marx; Labour theory of value; fetishism; heterogeneous labour; Böhm-Bawerk |
| Date: | 2024–06–04 |
| URL: | https://d.repec.org/n?u=RePEc:ris:sraffa:0065&r= |
| By: | Kai Barron; Tilman Fries |
| Abstract: | We study how one person may shape the way another person interprets objective information. They do this by proposing a sense-making explanation (or narrative). Using a theory-driven experiment, we investigate the mechanics of such narrative persuasion. Our results reveal several insights. First, narratives are persuasive: We find that they systematically shift beliefs. Second, narrative fit (coherence with the facts) is a key determinant of persuasiveness. Third, this fit-heuristic is anticipated by narrative-senders, who systematically tailor their narratives to the facts. Fourth, the features of a competing narrative predictably influence both narrative construction and adoption. |
| Keywords: | Narratives, beliefs, explanations, mental models, experiment, financial advice |
| JEL: | D83 G40 G50 C90 |
| Date: | 2024–05–08 |
| URL: | http://d.repec.org/n?u=RePEc:bdp:dpaper:0039&r= |
| By: | Crespi De Valldaura G, Virginia; Fifi, Gianmarco |
| Abstract: | Why do leftist forces accept, support and adopt free-market policies? To answer this question, we carry out a comparative study of left-wing groups (both parties and trade unions) in France, Italy and Spain during the late 1970s and the early 1980s. This period is widely acknowledged in international political economy to have represented a paradigm shift from post-war Keynesianism to neoliberal policy-making. We employ in-depth content analysis of memoirs, interviews to the press, opinion articles and policy-papers to explain actors’ positions on landmark policies implemented during such transition. In alignment with a developing literature in political economy (e.g. Mudge 2018), we find a proactive role of progressives in developing the ideological justification for the resort to liberal policies. However, we emphasise that widespread consensus among so-called progressives, rather than a leading role of technocrats or party experts, best explains such shifts. In this way, the paper casts doubts on interpretations of the liberalisation process that place excessive emphasis on the role of external constraints as well as on elite power. Drawing on Hall (1993), we argue that left-wing forces in the early 1980s have enacted a ‘second order change’, whereby policymakers use new instruments to meet existing policy objectives. |
| Keywords: | austerity; Left; neoliberalism; trade unions; Western Europe; T&F deal |
| JEL: | J1 |
| Date: | 2024–05–01 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:122747&r= |
| By: | Adam S. Tuzolele Mbuku (Université catholique du Congo - Université catholique du Congo) |
| Abstract: | Historically, Homo Economicus has been conceptualized as a perfectly rational individual who always seeks to maximize his utility. However, this assumption has been challenged by recent discoveries in neuroeconomics, which suggest that emotions and neural processes play a key role in economic decision-making. We have examined a variety of research works in the field of neuroeconomics, including those that explore the interaction between emotion and deliberation, the role of emotions in economic decisions, and how neural structures and mechanisms influence economic choices. These works have highlighted the importance of emotions in economic decision-making and have challenged the traditional assumption of Homo Economicus. Furthermore, we have explored how discoveries in neuroeconomics can help improve existing economic models by integrating knowledge about brain functioning. We have also discussed the potential implications of neuroeconomics for economic policy, particularly in the context of the Democratic Republic of Congo. |
| Abstract: | Historiquement, l'Homo Economicus a été conceptualisé comme un individu parfaitement rationnel qui cherche toujours à maximiser son utilité. Cependant, cette hypothèse a été remise en question par les découvertes récentes en neuroéconomie, qui suggèrent que les émotions et les processus neuronaux jouent un rôle clé dans la prise de décision économique. Nous avons examiné une variété de travaux de recherche dans le domaine de la neuroéconomie, y compris ceux qui explorent l'interaction entre émotion et délibération, le rôle des émotions dans les décisions économiques, et comment les structures et les mécanismes neuronaux influencent les choix économiques. Ces travaux ont mis en évidence l'importance des émotions dans la prise de décision économique et ont remis en question l'hypothèse traditionnelle de l'homo economicus. En outre, nous avons exploré comment les découvertes en neuroéconomie peuvent aider à améliorer les modèles économiques existants en intégrant les connaissances sur le fonctionnement du cerveau. Nous avons également discuté des implications potentielles de la neuroéconomie pour la politique économique, en particulier dans le contexte de la République Démocratique du Congo. |
| Keywords: | Neuroeconomics, Cognitive biases, Behavioral economics, Economic model, Homo economicus, Neuroéconomie, Biais cognitifs, Économie comportementale, Modèle économique |
| Date: | 2024–04–30 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-04564775&r= |
| By: | Antman, Francisca M. (University of Colorado, Boulder); Doran, Kirk (University of Notre Dame); Qian, Xuechao (Stanford University); Weinberg, Bruce A. (Ohio State University) |
| Abstract: | Using the EconLit dissertation database and large-scale algorithmic methods that identify author demographics from names, we investigate the connection between the gender of economics dissertators and dissertation topics. Despite stagnation in the share of women among economics Ph.D.s in recent years, there has been a remarkable rise in gender-related dissertations in economics over time and in many sub-fields. Women economists are significantly more likely to write gender-related dissertations and bring gender-related topics into a wide range of fields within economics. Men in economics have also substantially increased their interest in gender-related topics. |
| Keywords: | economic research, gender, dissertation |
| JEL: | I23 J16 O30 |
| Date: | 2024–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16980&r= |
| By: | Debin Ma (All Souls College, Oxford University); Jared Rubin (Chapman University) |
| Abstract: | This paper revisits the old theses of the contrasting paths to modernization between Japan and China. It develops a new analytical framework regarding the role of ideology and ideological change—Meiji Japan’s decisive turn towards the West pitted against Qing China’s lethargic response to Western imperialism—as the key driver behind these contrasting paths. Our framework and historical narrative highlight the contrast between Tokugawa Japan’s feudal, decentralized political regime and Qing China’s centralized bureaucratic system as a key determinant driving the differential patterns of ideological realignment. We argue that the 1894-95 Japanese naval victory over China could not be justified under the prevailing Imperial Chinese ideology and thus served as the catalyst for China’s subsequent ideological transformation, which occurred via borrowing Japan’s successful Meiji reforms of both institutions and ideology. Our analytical framework, developed from a comparative historical narrative, sheds new insights on the importance of ideology and ideological change for our understanding of political and economic change. |
| Keywords: | ideology, ideological change, China, Japan, economic development, economic divergence, Meiji Reform, centralization, decentralization |
| JEL: | N35 N45 N75 O33 O38 Z10 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:chu:wpaper:24-09&r= |
| By: | Rochet, Jean-Charles |
| Abstract: | This expository article surveys the literature that has followed my paper"A Necessary and Sufficient Condition for Rationalizability in a Quasi-linear Context" that was published in the Journal of Mathematical Economics in 1987. |
| Keywords: | multidimensional screening; rationalizability; bunching; mechanism design |
| Date: | 2024–05–23 |
| URL: | http://d.repec.org/n?u=RePEc:tse:wpaper:129345&r= |